Michael Hudson Quotes About Economy

Quotes about: Economy

There are many ways to create economic suicide on a national level. The major way through history has been through indebting the economy. Debt always expands to reach a point where it cannot be paid by a large swathe of the economy. This is the point where austerity is imposed and ownership of wealth polarizes between the One Percent and the 99 Percent.

Michael Hudson

Suicide, Wealth, Economic

Source: www.counterpunch.org
Debts grow and grow. And the more they grow, the more they shrink the economy. When you shrink the economy, you shrink the ability to pay the debts, so it's all an illusion that the system can be saved. The question is, how long are people going to be willing to live in this illusion?

Michael Hudson

Long, People, Debt

Source: www.counterpunch.org
Governments create money and spend it into the economy by running budget deficits. The paper currency in your pocket is technically a government debt.

Michael Hudson

Running, Economy, Currency

Source: www.counterpunch.org
The problems of 2008 were never cured. The Federal Reserve's solution to the crisis was to lend the economy enough money to borrow its way out of debt. It thought that if it could subsidize banks lending homeowners enough money to buy houses from people who are defaulting, then the bank balance sheets would end up okay.

Michael Hudson

People, House, Balance

Source: www.counterpunch.org
The most serious problems lie in the financial sphere, where the economy's debt overhead has grown more rapidly than the 'real' economy's ability to carry this debt. [...] The essence of the global financial bubble is that savings are diverted to inflate the stock market, bond market and real estate prices rather than to build new factories and employ more labor.

Michael Hudson

Real, Lying, Essence

"Financial Capitalism v. Industrial Capitalism". michael-hudson.com. September 3, 1998.
I think we're in the take-the-money-and-run stage of the economy. So the banks may go under, but the bankers, who make the policy, clean up.

Michael Hudson

Running, Thinking, Bankers

Source: www.counterpunch.org
More and more money is being extracted from of the production and consumption economy to pay the FIRE sector. That's what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services.

Michael Hudson

Fire, Debt, Pay

Source: www.counterpunch.org
We're at the end of long cycle that began in 1945, loading the economy with debt. We're not going to be able to get out of it until you write down the debts. But that's what the IMF believes is unthinkable. It can't say that, because it's supposed to represent the interest of the banks.

Michael Hudson

Believe, Writing, Long

Source: www.counterpunch.org
Since 2008 you've had the largest bond market rally in history, as the Federal Reserve flooded the economy with quantitative easing to drive down interest rates. Driving down the interest rates creates a boom in the stock market, and also the real estate market. The resulting capital gains not treated as income.

Michael Hudson

Real, Income, Gains

Source: www.counterpunch.org
Debtors will seek to cancel their debts. Creditors will try to collect, and the more they succeed, the more they will impoverish the economy.

Michael Hudson

Trying, Succeed, Economy

Source: www.counterpunch.org
The fact that you have government-guaranteed student loans has created a whole new sector in the American economy that didn't really exist before - private for-profit universities that sell junk degrees that don't help the students. They promise the students, "We'll help you get a better job. We'll arrange a loan so that you don't have to pay a penny for this education." Their pet bank gets them the government-guaranteed loan, and the student may get the junk degree, but doesn't get a job, so they don't pay the loan.

Michael Hudson

Jobs, Government, Pet

Source: www.counterpunch.org
When I say the economy is shrinking, it's the economy of the 99%, the people who have to work for a living and depend on earning money for what they can spend. The 1% makes its money basically by lending out their money to the 99%, on charging interest and speculating. So the stock market's doubled, the bond market's gone way up, and the 1% are earning more money than ever before, but the 99% are not. They're having to pay the 1%.

Michael Hudson

People, Shrinking, Gone

Source: www.counterpunch.org
To save the banks from making losses that would wipe out their net worth, you'll have to get rid of Social Security. It means that you'll essentially have to abolish government and turn it over to the banking system to run, with an idea that the role of governments is to extract income from the economy to pay to the bondholders and the banks.

Michael Hudson

Running, Mean, Loss

Source: www.counterpunch.org
Mr. Trump wants to turn the U.S. economy into the kind of real estate development that has made him so rich in New York. It will make his fellow developers rich, and it will make the banks that finance this infrastructure rich, but the people are going to have to pay for it in a much higher cost for transportation, much higher cost for all the infrastructure that he’s proposing. You could call Trump's plan "public investment to create private profit". That's really his plan in a summary.

Michael Hudson

Real, People, Kind

Source: www.counterpunch.org
That's the problem with the financial sector. Banks and the financial sector live in the short run, not the long run. In principle the government is supposed to make regulations that help the economy over time. But once it's taken over by the financial sector, the government lives in the short run too.

Michael Hudson

Running, Taken, Government

Source: www.counterpunch.org
Either you can save the economy, or you can save the One Percent from losing a single penny.

Michael Hudson

Pennies, Losing, Economy

Source: www.counterpunch.org
Needless to say, banks and bondholders do not want to promote any arguments explaining the limits to how much can be paid without pushing economies into depression.

Michael Hudson

Argument, Economy

Source: www.counterpunch.org
In China the largest denomination bill they have is 100 yen, and that's maybe $7. So here you have a whole economy working with only a $7 note as the largest denomination. The euro wants to get rid of the 500-euro bill just as the United States years ago got rid of the $1,000 bill because only the criminals used $1,000 bills.

Michael Hudson

Years, Criminals, United States

Source: www.counterpunch.org
Mathematically, debts grow exponentially at compound interest. Banks recycle the interest into new loans, so debts grow exponentially, faster than the economy can afford to pay.

Michael Hudson

Debt, Pay, Economy

Source: www.counterpunch.org
Every government, from the Obama administration right through to Angela Merkel, the Eurozone and the IMF, promise to save the banks, not the economy.

Michael Hudson

Government, Promise, Administration

Source: www.counterpunch.org
People think of a parasite as simply taking money, taking blood out of a host or taking money out of the economy. But in nature it's much more complicated. The parasite can't simply come in and take something. First of all, it needs to numb the host. It has an enzyme so that the host doesn't realize the parasite's there. And then the parasites have another enzyme that takes over the host's brain. It makes the host imagine that the parasite is part of its own body, actually part of itself and hence to be protected. That’s basically what Wall Street has done.

Michael Hudson

Wall, Thinking, People

Source: www.counterpunch.org
The IMF acts as the collection agent for global bondholders. Its projections begin by assuming that all debts can be paid, if economies will cut wages and wiping out pension funds so as to pay banks and bondholders.

Michael Hudson

Cutting, Assuming, Economy

Source: www.counterpunch.org
Basically, unless you're willing to write down debts and save the economy, you're going to have deflation and a steady drain in purchasing power - that is, shrinking markets.

Michael Hudson

Writing, Shrinking, Debt

Source: www.counterpunch.org
I think the less fracking there is, the better it is for the economy and society.

Michael Hudson

Thinking, Fracking, Economy

Source: www.counterpunch.org
You're having government spending on the economy being cut almost everywhere. That means that the only source of spending for growth has to come from borrowing from the banking system.

Michael Hudson

Mean, Cutting, Government

Source: www.counterpunch.org

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Born: 1939
Occupation: Professor
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